Plundering Russia's Timber

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WORLDWIDE FOREST/BIODIVERSITY CAMPAIGN NEWS

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Forest Networking a Project of forests.org

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9/12/99

OVERVIEW & COMMENTARY by EE

Russia contains one of the greatest forest wildernesses remaining on

the Planet. For how long is yet to be determined. It appears that

China is turning to Russia to meet its own timber demands. China is

reeling from lack of timber supply brought on by recent reductions in

logging. There will be tragic Planetary consequences if China is

able to export deforestation rather than living within its ecological

means. Following are two items regarding the matter.

g.b.

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ITEM #1

Title: Plundering RUSSIA's Timber

Source: Environment News Service

Date: September 10, 1999

ZABAIKALYE, Russia, September 10, 1999 (ENS) - In cash-poor Russia

where timber workers have a tough time getting paid the wages due

them, illegal timbering is flourishing.

The Timber Mafia, people profiting from illegal timber extraction in

Siberia and the Russian Far East, are cutting a wide swath through

the forests on public lands, according to forest conservation groups.

Jennifer Sutton of the non-governmental organization Baikal

Ecological Wave reported in June that one notoriously corrupt

governmental official had finally been ousted after a lengthy

investigation. That was the good news. The bad news, she said, was

that his replacement appeared to be just as bad, if not worse. He had

set himself up to profit from illegal harvesting of timber on public

lands.

Though there have long been foreigners interested in making a profit

off of deals in raw timber, and a great deal of timber marked

"Baikal" sitting in Japanese lumberyards, at least in the case of

Japan, this was covered by an agreement with the government of the

Republic of Buryatia, with some kind of deal apparently made for its

transport.

But recently there are no holds barred with regard to timber

exploitation. Citizens of China have come looking for timber, which

has become scarce there due to new government regulations. The

devastating floods which have occurred in China in 1998 have

triggered a tough stand by China's government to curb deforestation

in that country's highlands, which has been implicated in the

flooding.

Quoting Sergei Kez in an article from the Russian national newspaper

"Novie Izvestia" in February 1999, "The Chinese are ready to pay, and

pay most often in cash without any paper documentation.

The government of the Republic of Buryatia in Zabaikalye has been

eager to earn money through logging, and allows a significant

harvest. Thus, sending the timber to Zabaikalye would be a way to

"launder" it. An Internet search of "Ulan-Ude" in July turned up

hundreds of items, the first four or five of which advertised timber

for sale, one going as far as to say, "Chinese welcome." Still,

investigators have been flabbergasted at the volume of illegal deals.

Frequent raids have helped reduce the number of small groups and make

the black market firms more wary, but the extent of the traffic, when

uncovered, is voluminous.

One would hope this great demand for a resource would boost the

economy of Siberia. Not so. Quoting Sergei Kez again, "even amidst

such wealth, most companies in the timber industry eke out a

miserable existence. Meanwhile, native and foreign machinators are in

for the pickings."

For example, several wealthy local businessmen established a closed

joint-stock company, "Sibles," in 1995, which a little later bought

40 percent of the shares of the Igirminsky experimental Timber

Company. One of Sibles' founders, a former chairman of trades union

committee of the Regional Administration, was set up as chairman of

the board of directors of Igirminsky. He secured a contract for

delivery of the best timber and wood chip to the Baikalsk Paper and

Pulp Mill (also represented among Sibles' founders) at prices lower

than the cost of the timber. The Baikalsk Paper and Pulp Mill has

been notoriously unprofitable.

In order to prop up this and other enterprises, Sibles began draining

the Igirminsky Timber company dry, threatening the enterprise with

bankruptcy. The timber company workers took part in this swindle

"without a murmur," says Sergei Kez, "not having seen real money for

months. The money actually did come in, but not to the company's

account. The timber loggers were paid in kind - with foodstuffs and

various goods, but at high prices."

The Regional Administration and police are fighting to stop this

hemorrhage of resources and funds, but are hampered by federal

authorities, who are working at cross purposes, and all the loopholes

in the laws.

ITEM #2

Title: CHINESE Firm to Log Khabarovsk, Russia

Source: Environment News Service

Date: September 8, 1999

HARBIN, China, September 8, 1999 (ENS) - The Ministry of Foreign

Trade and Economic Cooperation has recently given permission to the

Harbin International Economic and Technological Cooperation Corp. in

northeast China's Heilongjiang Province to expand its timber business

in Russia.

Representatives of the Chinese firm will soon travel to Khabarovsk in

Russia's Far East to cut three million cubic meters of timber, "Asia

Pulse" reported Monday.

Deputy General Manager Yang Qiusheng said that the total investment

is estimated at 50 million yuan (US$6 million).

Yang said that the majority of the workers and equipment will be

obtained in Russia. The entire timber harvest will be sent to China

for sale.

Russia's forestry authorities have approved the project, Yang said,

because it reduces the possibility of an infection of insect pests in

the wake of disastrous forest fires last year.

"The company is the first to get permission for such work since

regulations were introduced on strengthening the administration of

Sino-Russian exploitation and utility of forest resources on April

26," said Yang.

The premiers of China and Russia signed a contract concerning timber

imports and exports during their fourth meeting last February,

Chinese officials said.

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